FSA fines ex-Berry Birch chief over client money

The FSA has slammed a £17,500 fine on the former chief executive of Berry Birch & Noble Insurance Brokers (BBNIB), Paul Harrison, after he failed to comply with client money rules.

Harrison notified the FSA after the broker's auditors uncovered a series of serious failings in its client money systems and practices while he was chief executive of the company.

The regulator said Harrison had not known or inquired whether BBNIB was complying with those rules before the auditors became involved, despite the corporate governance rules imposed by the FSA

Margaret Cole, FSA director of enforcement, said: "Mr Harrison was an approved person who failed to carry out his controlled functions, which included chief executive of his firm, with due skill, care and diligence.

"His failure meant that BBNIB did not provide adequate protection for its clients' money."

The FSA found that Harrison was responsible for the firm's failure to segregate client money, to keep track of client money held by third parties and to perform essential client money calculations and reconciliations.

Prior to its sale to Smart & Cook, BBNIB was owned by financial services group Berkeley Berry Birch (BBB), which last year landed itself in trouble with the FSA over regulatory capital shortfalls.